The word "carrier" is a reference to the analog carrier signal generated by a modem, which is modulated to carry the data. On a data modem, loss of the carrier equates to termination of the connection.
Much like the Ring Indicator signal, on a PC's serial port, changes to the DCD signal state generate a hardware interrupt that can be captured by the processor any time the DCD signal changes state, preventing the PC from needing to constantly poll the pin.
Although DCD is a one-way signal from the device to the computer, the DTR (Data Terminal Ready) is the corresponding line that carries the same status from the computer back to the device, when applicable.
External modems with LED status lights usually have a light labeled "CD" (carrier detect). This status light is directly coupled with what the modem is sending the DCD line.
By default, when a modem is powered up, the DCD signal stays low. It does not go high until the modem either makes an outgoing call, or answers an incoming call, and then connects with a data modem on the other end. The signal goes high at the same time the modem reports its CONNECT message, and stays high until the call is disconnected. The signal goes low again once the local modem has lost contact with the remote modem, regardless of which side initiated the disconnect. So long as the DCD signal is high, the computer can assume that any data coming from the modem was actually sent from the remote side.
AT&C followed by a single digit. More frequently, the setting is buried in a longer initialization string - such as AT&F&D2&C1S0=0X4. Note that per the specifications, AT commands can be concatenated together by only specifying the characters "AT" once, followed by all the remaining commands strung together. AT&C0 - Always assert DCD : This command tells a modem that it should always hold DCD high, regardless of the connection state. This takes away the ability for the host to positively detect a loss of connection. But in some cases it can be useful - such as when using a pre-configured modem to automatically answer and provide remote access to some equipment that wasn't meant to be connected to a modem. In that case, that equipment may require a "high" signal at all times for the communication setup to function. An external modem that has been configured with AT&C0 will have its CD light on at all times - even when not connected to a remote modem - to reflect the asserted DCD pin. AT&C1 (default for nearly all modems) - Assert DCD only when connected : This sets the modem to behave normally, with DCD high only when connected to a host. AT&C2 (supported by most but not all modems) - Always assert DCD with disconnect signalling : The modem asserts DCD whenever it is powered on, except immediately after sensing a disconnect. Upon sensing a disconnect, the DCD line goes low for a brief time (typically 1-2 seconds), and then returns high. Support can easily be determined by attempting the command, and noting the modem's response (ERROR versus OK).The meaning of DCD differs when the modem is in fax or voice modes. In these modes, its importance is diminished. The fax and voice protocols provide for a data link escape (DLE) character in the data stream that permits the computer to differentiate between reports from the modem and data from the remote side. In those cases, if the remote side sends a byte matching the DLE byte, the modem sends it to the host PC twice in a row to signal that it came from remote. During fax and voice transmission, flow control (such as over RTS/CTS pair) is much more important than the DTR/DCD signal.
When used in this scenario, DCD is used to simply detect the presence and/or readiness of the other side to start a session. For example, on PC's running Windows, the DTR output is kept low until some program is run to access the serial port and raise the DTR signal high. The remote side will sense this as the DCD input going high. Some equipment will recognize the transition alone as the beginning of a session. Other equipment (such as the console port of a router) may expect characters to be transmitted, but the DCD signal high as a prerequisite for communicating.
Sometimes a computer is connected to a device that doesn't provide a DCD signal at all. If the computer software requires a DCD signal to properly recognize a connection, then this is mitigated simply by connecting a wire between the computer's own DTR and DCD pins, so the computer sees the high DCD signal it needs. Since DTR and DCD are typically used as a pair, any computer program requiring DCD high is likely to also provide a high DTR as output.
In Linux, each serial port is referenced by two device names - one being (for the first serial port) /dev/ttyS0 versus /dev/cua0. Although these both refer to the same physical port, one important distinction between the way Linux treats these two device names has to do with the DCD line. When ttyS0 is waited on in a system call, Linux assumes that since this device is for receiving telephone calls, it will put a process to sleep— figuring that so long as DCD is low, there is nothing to do. When cua0 is used - as it is when placing telephone calls - Linux assumes that the software needs to access the port while DCD is low for the purpose of dialing the number, so this blocking behavior doesn't exist. Nevertheless, there is a control mode flag called CLOCAL that is what actually activates or deactivates this behavior, and by default the flag is set for cua0 but not for ttyS0. An application that insists on using a "tty" port versus a "cua" port is an example of one that might require a jumper wire to force DCD high in order to work properly.